Trade Secrets

WTF Dailies September 30, 2025

President Trump met with Democrats in the Oval Office on Monday, but both sides left the talks indicating they had made no progress on striking a deal that would avert a government shutdown.

Sage Kakkat

29 Sep 2025 — 7 min read

US stock futures held steady with Wall Street worried a government shutdown could begin as soon as Wednesday.
President Trump met with Democrats in the Oval Office on Monday, but both sides left the talks indicating they had made no progress on striking a deal that would avert a government shutdown. Lawmakers have until Wednesday at 12:01 a.m. ET to reach an agreement or else a partial government shutdown is set to begin. "I think we're headed to a shutdown," Vice President JD Vance said after the meeting.
If a stoppage goes forward, in addition to mass firings and chaos at the airport, the government is set to cease publishing economic data at a time when the Federal Reserve and Wall Street have a particular need for it. The Department of Labor said its Bureau of Labor Statistics (BLS) would "completely cease operations" during a stoppage, with just one of 2,055 full-time employees continuing to work.
Wall Street and the Fed are anxious to receive Friday's release of the September jobs report as scheduled. A slew of mixed economic data has shaken confidence in the Fed's expectation of two more rate cuts this year as a sure thing, especially as apparent divisions emerge among policymakers.
Most Asian stocks kept to a slim range on Tuesday following mixed business activity readings from the region’s biggest economy, while Australian shares moved little before the conclusion of a Reserve Bank meeting.
Regional markets took some positive cues from Wall Street, which closed higher overnight on strength in technology stocks. But concerns over a looming U.S. shutdown limited any major gains.
China’s Shanghai Shenzhen CSI 300 and Shanghai Composite indexes rose less than 0.2%, while Hong Kong’s Hang Seng index fell slightly. Local trading volumes were muted ahead of the week-long National Day holiday, which is set to begin from Wednesday.
Government purchasing managers index data showed manufacturing activity shrinking for a six consecutive month, while services activity growth also slowed.
But private PMI readings painted a drastically different picture. RatingDog PMI data showed manufacturing activity expanding at its sharpest pace in six months, while service sector activity also clocked outsized growth.
Government and private PMIs differ in their scope of companies and regions covered, with investors usually using both prints to gain a broader picture of the Chinese economy.
But the sustained weakness in the government PMIs may elicit more stimulus measures and monetary easing from Beijing, with support from late-2024 stimulus seen petering out in recent months.
Australia’s ASX 200 index was flat as investors hunkered down before a closely watched decision on interest rates.
The Reserve Bank of Australia is widely expected to keep rates unchanged at 3.60%, amid caution over sticky inflation and a cooling labor market.
But focus will be squarely on Governor Michele Bullock’s address for any cues on future rate decisions. Recent signs of resilience in the economy are expected to potentially delay the RBA’s plans to cut rates further, after a total of 75 basis points of cuts this year.
Broader Asian markets largely kept to a tight range on Tuesday. Japan’s Nikkei 225 fell 0.2%, while the TOPIX was flat after both indexes marked a weak start to the week. Japanese markets were pressured by some resilience in the yen, which hurt export-heavy sectors.
Japanese industrial production and retail sales data largely missed expectations for August, sparking more concerns over a sluggish economy. But weakness in growth could also delay any more interest rate hikes by the Bank of Japan.
Futures for India’s Nifty 50 index pointed to a flat open, with local markets also on edge before an interest rate decision by the Reserve Bank of India on Wednesday.
South Korea’s KOSPI rose 0.1%, while Singapore’s Straits Times index rose 0.2%. South Korean industrial production and retail sales data also largely underwhelmed for August.

Market Close

Equity markets reversed an early pullback to close higher on Tuesday as investors appear to shake off government-shutdown concerns. The S&P 500 delivered a solid 3.3% gain for September. Sector performance was broadly higher, with health care and technology stocks leading gains, while the energy and consumer discretionary sectors trailed.
Bond yields edged higher, with the 10-year U.S. Treasury yield at 4.16%, above its recent low of 4.0% earlier this month.
In international markets, Asia finished mixed, as China's manufacturing Purchasing Managers Index (PMI) rose more than expected in September but remained modestly in contraction territory.
The U.S. dollar weakened against major international currencies. In commodity markets, WTI oil traded lower on expected OPEC+ production hikes.
Key economic releases scheduled for this week should provide updates on the labor market, though some data could be delayed in the event of a government shutdown. Job openings for August held roughly steady at 7.2 million in August, ahead of forecasts for a pullback to 7.1 million. Total nonfarm payrolls, if released on time, will provide a deeper look at the labor market on Friday, with estimates calling for 50,000 jobs created in September, up from just 22,000 in August.
The unemployment rate is expected to hold steady at 4.3%, while forecasts are pointing to 3.7% hourly wage growth year-over-year, also in line with the August figure. With unemployment still relatively low and job openings modestly below the 7.4 million people who are unemployed, the labor market appears to be cooling but not collapsing.
Despite the softer labor market, wage growth continues to outpace CPI inflation of about 2.9%, providing rising discretionary income to support consumption. Continued consumer-spending growth should help sustain the economy and labor market.
With the current fiscal year ending today and no funding agreement in place, a government shutdown could begin tomorrow. The U.S. House of Representatives recently passed a short-term funding measure, but the legislation faced resistance in the Senate as Democrats seek to reverse some of the health care cuts that were in the tax bill passed over the summer. If no agreement is reached, nonessential parts of the federal government would shut down, furloughing workers and halting some services until funding is restored.

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